I'm accustomed to finding a lot of companies/stocks with the basic
pattern of "love the company, not comfortable with the valuation on the
stock," but West Pharmaceutical Services (NYSE:WST)
dials that up to 11. I really like the company's strong share in
biologics delivery systems/components, its overall share in components
and systems for injectable drugs, and its leverage to higher-margin,
higher-growth proprietary products serving a market that I believe is
set for good volume growth for the long term. What I don't like is that
it would appear that not even long-term annualized FCF growth in the
mid-teens or a 15x forward EBITDA multiple is enough to drive a fair
value above today's price.
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The Expectations For West Pharmaceutical Look Hard To Meet
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